Question $8$

$5$ pts

To convert book value of interest bearing debt to its market value one needs to treat debt as a fixed coupon bond. In this case, the weighted average maturity of debt serves as time to maturity. Book value of debt as par value and annual interest expense from the income statement as coupon. Cost of debt is used to discount all cash flows. Coupon$*(1\frac{\text{:}\frac{1}{(1+Rd{)}^{{?}^{{?}^{?}}}}n}{R}d+$Par Value $\frac{?}{(1+Rd{)}^{{?}^{{?}^{?}}}n}$ is the bond valuation formula.

If Disney's annual interest expense in $978,$ book value of interest bearing debt is $46986,$ weighted average maturity is $9$ years and the cost of debt is $3\mathrm{.}12,$ what is the market value approximation of this debt?

$47229$

$40297$

$37912$

$43208$